North Hanover Mall up for sale

Owner offers to sell five malls in effort to lower debt.

The North Hanover Mall is one of five malls a Philadelphia-based real-estate company has put up for sale in an effort to lower its debt.

Mall owner Pennsylvania Real Estate Investment Trust announced during an earnings call last month that selling the malls is part of the company's strategic "leverage reduction" plan.

PREIT's Director of Corporate Communication Shawn Southard said there wasn't one factor that led the company to put the North Hanover Mall and the other sites on the market. He said there is a complex analysis that goes into determining if it is a "non-strategic" asset.

"It wasn't any one factor. It's not simply because rents aren't at a certain level or sales aren't at a certain level," he said.

Southard said PREIT continually evaluates properties for disposition and acquisition.

The company purchased the 355,763-square-foot North Hanover Mall in 2003 from Crown American. It announced earlier this year that JC Penney will be relocating within the mall to a larger, two-story site that was constructed in anticipation of Boscov's opening. That move is expected to take place in the fall.

Southard said the North Hanover Mall had an occupancy rate of 93.8 percent as of March 31, compared an average of 91.9 percent for company properties overall.

In addition to the North Hanover Mall, PREIT is looking to sell the Beaver Valley Mall, Chambersburg Mall, Phillipsburg Mall, and the Orlando Fashion Square.

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"As we have previously mentioned, the company is focused on leverage reduction, and one way of accomplishing this is to sell non-strategic assets. To that end, we are in the market with five assets for disposition," PREIT President Edward Glickman said during the call.

Southard said the company has not disclosed an asking price for the properties.

Also during the earnings call, the company reported an all-time high for sales of $376 per square foot in the first quarter of 2012. PREIT owns 38 malls, mostly in the mid-Atlantic region.

The North Hanover mall, which also includes anchors Sears and Dick's Sporting Goods, opened in 1967 and was redeveloped in 1999.

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